Whether the effects are felt next week or in 20 years time, this is a momentous decision. I see very little coverage of it in the MSM either. This does indeed mean the end of US hegemony. For the neocons you can't have a bit of hegemony; it has to be total. The dollar can't be just one of many big currencies; it has to be THE currency. All that is now over. Without the petrodollar they can't finance the full spectrum dominant military they need and they can't bully smaller nations into "democracy". As you say, those nations now have other options. What a year 2024 is turning out to be.
A point was pricing power for gold has moved to China.
Zerohedge mentioned how a couple of big players are keeping the price of gold low through futures, and with physical gold moving to China that may explode:
Thanks very much, Ray. It does seem Gold and its now bifurcated markets is key - that is something that will resolve with a little time. Your post couldn't be more timely or applicable. I look forward to reading the links. As for Russia and sanctions it has been nothing but lies from the get go. No surprise there.
Something is coming down the pipeline with Gold. Too many different signals.
China’s development of a gold exchange was not an accident. It is removing the ability of Western actors to control the price of gold.
There is so much financialization of metals it’s ridiculous. And use of warehouses and strategic withdrawal speeds and flow to control / manipulate prices.
My guess is China will expand beyond Gold with new exchanges and storage of metals.
Back on topic to Gold. Seems there will be some cross border trade settlement mechanism using gold. Or as a way to store foreign reserves using gold, since the euro and dollar have been shown to be untrustworthy.
And the Western Russian sanctions are motivating/ speeding up the development and implementation of this system.
Impact:
- increased inflation in U.S. / reduction of U.S. ability to print money at no cost / deficit spending
- weakened U.S. dollar as world reserve currency
- weaker ability of west for sanctions
- reduction or replacement of imf loans / foreign debt
- weakening of London and nyc as financial centers
Guesses/ swags:
- reduced power of Western currency speculation to crash foreign currencies
- improved Bric economies moving away from current neo-colonial model
- increased trade between Bric nations
- reduced price of oil for Bric countries by not using dollars
- weakening of U.S. dollar. Imports become more expensive
- set up of special banks / trading houses with no western trade to do business with Russia not just in China.
Thanks for the great comment and analysis, Ray! I think you are correct in everything you say. I thought the ZeroHedge article was both enlightening and made sense in its analysis. I also enjoyed the Luongo/Lanci podcast and found Lanci's addressing the Gold arbitrage now going on quite pertinent to much of what you write above. That situation cannot and will not persist beyond the BRICS' establishment of their own financial system for trading.
Damn, who would have seen this coming? Major eye roll. These clowns are so far out of their depth that it would be hilarious if it wasn’t for the fact that this is no laughing matter.
In a podcast with Tom Luongo, Vince Lanci mentioned physical arbitrage has happened expedited I think JP Morgan. Basically physical gold was moved from nyc to Shanghai due to the difference in price. He heard it from several different sources. Basically if there is enough difference somebody will make a profit by capitalizing on it.
Alex Krainer writes on related topics today. He quotes Zbigniew Brzezinski, “The most immediate task is to make certain that no state or combination of states gains the capacity to expel the United States from Eurasia or even to diminish significantly its decisive arbitration role.”
Everyone focuses on the physical presence of the US, but it was our wisdom and diplomacy that Brzezinski saw as our most important export.
Great companion piece. Disabuses anyone of the idea that all of this hasn't been contemplated by the U.S. foreign policy establishment and acted upon by them for a very long time. Thanks.
Sounds like Saudi Arabia needs some Freedom™ and Democracy®. What color will their 'revolution' be? And how did our oil get under their sand?
I didn't know such a formal agreement existed. Thanks very much for the education and apologizes to commenters for my previous ignorance.
I knew there was an agreement but didn't know it was basically a contract with an expiration
Same here. I never realized it was a contract with a time limit or terms for renewals.
Whether the effects are felt next week or in 20 years time, this is a momentous decision. I see very little coverage of it in the MSM either. This does indeed mean the end of US hegemony. For the neocons you can't have a bit of hegemony; it has to be total. The dollar can't be just one of many big currencies; it has to be THE currency. All that is now over. Without the petrodollar they can't finance the full spectrum dominant military they need and they can't bully smaller nations into "democracy". As you say, those nations now have other options. What a year 2024 is turning out to be.
Tom Luongo had a related podcast:
https://tomluongo.me/2024/06/08/podcast-episode-179-vince-lanci-and-janet-yellens-mushroom-headed-policy/
A point was pricing power for gold has moved to China.
Zerohedge mentioned how a couple of big players are keeping the price of gold low through futures, and with physical gold moving to China that may explode:
https://www.zerohedge.com/geopolitical/gold-oil-understanding-rather-fearing-change
Link on legalized comex price fixing was interesting.
I think it was a tom Luongo that mentioned guess on Russian gdp was off by 10x. 10 trillion vs 1 trillion, hence part of why sanctions failed.
Thanks very much, Ray. It does seem Gold and its now bifurcated markets is key - that is something that will resolve with a little time. Your post couldn't be more timely or applicable. I look forward to reading the links. As for Russia and sanctions it has been nothing but lies from the get go. No surprise there.
You are welcome.
Something is coming down the pipeline with Gold. Too many different signals.
China’s development of a gold exchange was not an accident. It is removing the ability of Western actors to control the price of gold.
There is so much financialization of metals it’s ridiculous. And use of warehouses and strategic withdrawal speeds and flow to control / manipulate prices.
My guess is China will expand beyond Gold with new exchanges and storage of metals.
Back on topic to Gold. Seems there will be some cross border trade settlement mechanism using gold. Or as a way to store foreign reserves using gold, since the euro and dollar have been shown to be untrustworthy.
And the Western Russian sanctions are motivating/ speeding up the development and implementation of this system.
Impact:
- increased inflation in U.S. / reduction of U.S. ability to print money at no cost / deficit spending
- weakened U.S. dollar as world reserve currency
- weaker ability of west for sanctions
- reduction or replacement of imf loans / foreign debt
- weakening of London and nyc as financial centers
Guesses/ swags:
- reduced power of Western currency speculation to crash foreign currencies
- improved Bric economies moving away from current neo-colonial model
- increased trade between Bric nations
- reduced price of oil for Bric countries by not using dollars
- weakening of U.S. dollar. Imports become more expensive
- set up of special banks / trading houses with no western trade to do business with Russia not just in China.
Thanks for the great comment and analysis, Ray! I think you are correct in everything you say. I thought the ZeroHedge article was both enlightening and made sense in its analysis. I also enjoyed the Luongo/Lanci podcast and found Lanci's addressing the Gold arbitrage now going on quite pertinent to much of what you write above. That situation cannot and will not persist beyond the BRICS' establishment of their own financial system for trading.
Thanks much, again.
Yeah, it looks like we're yanking all the levers that used to work, but they're not longer connected the way they used to be.
Damn, who would have seen this coming? Major eye roll. These clowns are so far out of their depth that it would be hilarious if it wasn’t for the fact that this is no laughing matter.
In a podcast with Tom Luongo, Vince Lanci mentioned physical arbitrage has happened expedited I think JP Morgan. Basically physical gold was moved from nyc to Shanghai due to the difference in price. He heard it from several different sources. Basically if there is enough difference somebody will make a profit by capitalizing on it.
I think it was this one:
https://tomluongo.me/2024/03/19/podcast-172-vince-lanci-banks-bitcoin-mining/
Very cogent response, thanks.
Alex Krainer writes on related topics today. He quotes Zbigniew Brzezinski, “The most immediate task is to make certain that no state or combination of states gains the capacity to expel the United States from Eurasia or even to diminish significantly its decisive arbitration role.”
Everyone focuses on the physical presence of the US, but it was our wisdom and diplomacy that Brzezinski saw as our most important export.
https://alexkrainer.substack.com/p/the-vicky-pollard-administration
Great companion piece. Disabuses anyone of the idea that all of this hasn't been contemplated by the U.S. foreign policy establishment and acted upon by them for a very long time. Thanks.
Gives new meaning to the phrase, ”Stupid Americans.”
Emotional leadership v Logical leadership